Coinbase Launches OTC Trading for Institutional Investors

From Coinbase Prime to its Custody service, the exchange has been laying the groundwork for institutional investors for a while now. Earlier this year, Coinbase announced it was on track to be a broker-dealer regulated by the U.S. Securities and Exchange Commission. The exchange also acquired securities dealer Keystone Capital and others, in a bid to expand its offerings to include crypto securities trading, margin trading and OTC trading.

Coinbase Head of Sales Christine Sandler said that the increasing demand for OTC crypto trading made the move a must-have for the exchange.

“We launched our OTC business as a complement to our exchange business because we found a lot of institutions were using OTC as an on-ramp for crypto trading.”

According to Sandler, the launch will enable clients to leverage Coinbase’s crypto exchange and OTC service. There is also the possibility of the crypto trading platform combining its OTC service with its custody business.

“Circle and a number of others have complementary products, but they also trade on a proprietary basis, so they are the counterparty to each transaction, while we, in fact, are matching client orders.”

The OTC trading desk has been added to the basket of services offered by the U.S.-based crypto exchange at a time when digital asset prices are experiencing a decline in their market values.

“From our crypto first clients, we’re hearing that nothing has changed with respect to technology, and they’re still absolutely committed to crypto … to the technology. I think that there’s one small silver lining to this volatility … [it’s] that crypto’s been front and center of the mainstream financial media for the last few weeks. I think that has driven … forced a lot of institutions to think, really, is this an opportunistic investment point for crypto at this point.”